Seattle City Council and Kshama Sawant capitulate to Amazon, pass watered-down head tax

 

Seattle City Council and Kshama Sawant capitulate to Amazon, pass watered-down head tax

By
Alec Andersen

19 May 2018

Following a weeks-long campaign of economic blackmail waged by Amazon and other large corporations, the Seattle City Council unanimously passed a watered-down version of the head tax on big business last Monday. The tax will fund housing construction and services for Seattle’s large and growing homeless population. The bill will cost the company just $10 million annually, which represents less than the amount Amazon CEO Jeff Bezos makes in an hour.

Under the legislation passed Monday and signed into law on Wednesday, for-profit businesses with annual gross revenue of at least $20 million in Seattle—representing the top 3 percent of businesses—will be taxed at a rate of $0.14 per employee for every hour worked in the city, or roughly $275 annually for a full-time employee beginning in 2019. The measure will produce an estimated $47 million in revenue that will be used to build low-income housing and provide hygiene and other vital services to a fraction of Seattle’s roughly 12,000 homeless residents. The measure also contains a “sunset clause” that effectively ends the tax after five years unless renewed by a vote of the city council.

This represents just half the revenue that would have resulted from the original version of the bill proposed by Democratic Party councilmembers Teresa Mosqueda, Mike O’Brien, Lorena Gonzalez, and Lisa Herbold on April 20. This version of the bill would have placed a tax of $0.26 per employee hour worked—or $500 annually per employee—on large businesses. This employee hours tax (EHT) would then have been phased out in favor of a 0.7 percent payroll tax in 2021.

Almost immediately after its introduction, a…

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